Gaddis said Wednesday that he and the hotel reached a mutual decision because "it's the right thing to do to stop all the tension," among cabbies upset by Gaddis' virtual monopoly on Broward's cab business. Neither he nor hotel management would say whether Gaddis had already signed a contract.

But the issue is not dead, Gaddis promised. He will lobby again after the Diplomat has a chance to compare his cabs with others lining up in front of one of Broward's premier destinations.

"I expect that at some point they will decide that our fleet is much nicer, that we can do a better job than anyone else," Gaddis said. "The Diplomat is very particular and they expect the best, so I would think we'll wind up as their provider eventually."

Diplomat spokeswoman Michelle Le Vous confirmed that the decision was mutual but provided few details.

"It seems as though this is the only fair way to do it," Le Vous said. "I think everybody had enough on their minds getting ready to open."

The $800 million, 1,054-room Diplomat is scheduled to open today, about two years behind schedule. The chance to serve the hotel, where rooms will run from about $280 to $6,000 per night, had local cabbies salivating.

Although details aren't final, the new cab arrangement will likely have a special taxi lane, where drivers will line up in order.

Gaddis was negotiating a contract last week until Barry Barak, owner of Friendly Checker Cab in Hollywood, started calling hotel management. He then enlisted Hollywood Mayor Mara Giulianti, who lobbied for Barak and all other small cab owners in the county.

Gaddis, owner of the Yellow Cab company in Fort Lauderdale, has an exclusive contract to serve Fort Lauderdale-Hollywood International Airport and has strong political influence in the county.

"I told Jesse that I'm not going to sit idle, I'm going to fight this," Barak said. "I explained to him that it would upset a lot of people, and that it would be better for the hotel and better for the taxi industry.

"The competition will make everyone do a better job, and I told that to the people at the Diplomat too," Barak said. "Finally, Jesse called me [Tuesday] and said I was right."

Giulianti weighed in with a call to Diplomat General Manager Gary Sims. "When I heard that the usual taxi czar was about to get another exclusive, I just told Gary that I thought it would be a terrible thing to have happen," she said. "Everyone in Hollywood has been looking forward to this opening to help their business, and it wouldn't be fair ..."

John Holland can be reached at jholland@sun-sentinel.com or 954-385-7909.